Natural Industrial Relations
Ron Johnson
[]
"The land shall not be sold
in perpetuity, for the land is mine; with me you are but aliens and
tenants."- (Leviticus 25:23)
INTRODUCTION
The earnest debate about the Federal Government's new industrial
relations laws is essentially a struggle over different models of
labour regulation. Yet it is far more important to take a broader view
and to strive, by peaceful means, for the freedom of labour. The
freedom of labour means the removal of the regulatory restrictions
upon the natural and equal right of all people to apply their labour
to land. The freedom of labour is the key to economic co-operation and
social progress, including the elimination of poverty and involuntary
unemployment. With the freedom of labour won, industrial relations
would be regulated only by "mutual interest and convenience"[1]
and "
wages would rise to the fair earnings of labour."[2]
THE FREEDOM OF LABOUR
By far the greatest regulatory impediment to the free operation of
the labour market is the private ownership of land. While the private
ownership of land remains, neither the continuance nor the repeal of
the new industrial relations laws can possibly bring social justice.
The private ownership of land creates monopoly privileges that
restrict the capacity of people to freely engage in labour and
enterprise.
"As access to land is the absolutely basic condition for any
participation in the common good, the question of land rights must be
settled satisfactorily if the common good is not to be perverted into
the enrichment of some at the expense of others."[3]
Industrial relations emanate from the application of labour. Labour
does not necessarily need the framework of an employment relationship.
Access to land is the fundamental pre-requisite for labour to occur.
Equal access to land is a natural right and tantamount to the freedom
of labour. Unequal access to land causes unemployment, low wages and
the conditions whereby masses of vulnerable employees become dependent
upon employers for the opportunity of paid work. The freedom of labour
would enable optimum numbers of people to work together co-operatively
as interdependent equals. "While the term workplace relations,
with its micro-economic slant, focuses attention upon relations
between employer and employee, the real problem remains one of the
conditions under which producers (of all kinds) get access to land."[4]
A system of natural industrial relations, in which the freedom of
labour prevails, would enable the best possible opportunity for
economic prosperity for all. Only the freedom of labour can unlock the
enormous untapped potential of human labour possible through increased
spontaneous co-operation. It is spontaneous co-operation that fuels
innovation, raises efficiency and wages, lowers prices, enables
meaningful and dignified employment and determines the vitality of
civilisation. Only the freedom of labour will enable Australia to
compete successfully with the much larger economies of China, India
and the United States. "
it is only in independent action
that the full powers of the man may be utilised. The subordination of
one human will to another human will, while it may in certain ways
secure unity of action, must always where intelligence is needed,
involve loss of productive power."[5]
THE "WORKCHOICES" RE-REGULATION
The message from the Federal Government and their supporters[6] is
that the new industrial relations laws are necessary reforms. They
claim that less industrial relations regulation will bring increased
choice for employers and employees to settle arrangements tailored to
their mutual circumstances, leading to fairer outcomes, higher wages,
more jobs and an even stronger economy.[7]
Yet, the reality is that the new laws are not genuinely de-regulatory
nor are they reformist. The laws merely re-regulate the industrial
relations system so as to increase the exposure of workers[8] to the
labour market. The market is made unnecessarily harsh by the
regulatory distortion caused by the private ownership of land and its
consequent subsidiary privileges. Therefore, low paid and
disadvantaged labour market groups in particular, will actually be
faced with less choice at work.
"Those who are most to be considered, those for whose help the
struggle must be made, if labour is to be enfranchised, and social
justice won, are those least able to help or struggle for themselves,
those who have no advantage of property or skill or intelligence, the
men and women who are at the very bottom of the social scale. In
securing the equal rights of these we shall secure the equal rights of
all."[9]
The Government is trying to clear the labour market from the wrong
end by seeking to subdue the Australian Industrial Relations
Commission (AIRC) and trade unions and generally to lower minimum
conditions standards. However, in the absence of the freedom of
labour, these institutions and standards have served as socially
important partial palliatives against injustice.
The Government is correct to point out that these institutions and
standards have historically not been able to prevent recessions and
unemployment. However, the suggestion that somehow they are the cause
of unemployment is like trying to blame the bandage for the bleeding.
True labour market reform can only begin with the breaking of land
monopoly as embodied in the private ownership of land.
"
in a world where
natural materials and
opportunities were as free to all as is the air to us, there could
be no difficulty in finding employment, no willing hands conjoined
with hungry stomachs, no tendency of wages toward the minimum on
which the worker could barely live. In such a world we would no more
think of thanking anybody for furnishing us employment than we here
think of thanking anybody for furnishing us with appetites."[10]
With land monopoly broken, all other privileges and impediments
distorting the free labour market would, through the power of free
competition, naturally dissipate or evolve into non-intrusive forms.
"We
see in the social and industrial relations of men not
a machine which requires construction, but an organism which needs
only to be suffered to grow."[11]
THE LIGHT ON THE "LAND QUESTION"
Unbeknown to most people today, the Australian labour movement seized
upon the importance of the land question from very early in its
genesis.[12] In 1888, at the Fifth Inter-Colonial Trade Union
Congress, upon the motion of the Progressive Society of Carpenters and
Joiners of Brisbane, the following resolution was unanimously adopted:
"That it is the opinion of this Congress that a simple yet
sovereign remedy which will raise wages, increase and give
remunerative employment, abolish poverty, extirpate pauperism, lessen
crime, elevate moral tastes and intelligence, purify government and
carry civilisation to a yet nobler height, is to abolish all taxation
save that on land values."[13]
When the Labour Party was formed in 1891, the thirteenth plank of its
original platform read in part, as follows:
"The recognition in our legislative enactments of
the natural and inalienable rights of the whole community to the
land
by the taxation of that value which accrues to the land
by the presence and needs of the community, irrespective of
improvements erected by human exertion."[14]
With the notable exception of the Honourable Clyde R. Cameronxv AO
(MHR 1949-1980 and Minister for Labor in the Whitlam Labor Government
1972-75), more recent labour movement leaders rarely acknowledge the
crucial link between land rights and a fair system of industrial
relations. If land rights are discussed, it is limited to the very
important and more obvious area of indigenous land rights.
Contemporary labour leaders are focused upon promoting an industrial
relations system of mainly collective bargaining with a strong
regulatory role for the Australian Industrial Relations Commission
(AIRC). Some concede that a national system of industrial relations
may be more practical. However, most agree there is no imperative to
significantly alter the industrial relations legal status quo.
Throughout 2005, unions, the Australian Labor Party (ALP) and many
church representatives and academics have expressed concerns that the
new industrial relations laws will promote unfair bargaining, strip
away hard-won rights and drive down conditions and wages, particularly
for the most vulnerable in the labour market. Over the past century or
more, good people of the labour movement have devoted their lives to
the establishment and defence of the legal rights at work now stripped
away or limited by the new legislation. These rights include; the
right to independent conciliation and arbitration, the right to
organise and bargain collectively, the right to a 'living' minimum
wage, the right to a safety net of award conditions, the right to
strike and the right to protection against unfair dismissal.
It is important to understand that these legal rights are "concession
rights", settled by way of a regulatory compromise between the
establishment and labour representatives that has been ongoing at
least since the widespread industrial strife of the 1890's. These
concession rights have been socially important and remain so in the
absence of the true justice embodied in realising equal rights to
land. However, they can never be more than a far inferior substitute
for justice.
"
we believe not that labour is a poor weak
thing that must be coddled or protected by government. We believe
that labour is the producer of all wealth- that all labour wants is
a fair field and no favour, and, therefore, as against the doctrines
of restriction we raise the banner of liberty and equal right in the
gospel of free, fair play."[16]
Industrial relations laws that do not remedy unequal access to land
have only a limited capacity to affect wages and labour demand. Labour
market forces eventually override such narrow industrial relations
legislation, just as an ocean tide washes over a sand bank. Industrial
relations regulations currently advocated by the labour movement are
an attempt to modify the evil effects fundamentally caused by the
previous denial by regulation, of the people's natural rights to land.
THE ETHICS OF INDUSTRIAL RELATIONS
Industrial relations can be defined as all human interactions and
exchanges relating to labour and wage determination. Industrial
relations cannot be divorced from ethics, political economy or
spirituality. Industrial relations only arise as people associate
together and apply their labour to land. The natural right to land
lies at the heart of labour freedom and also at the heart of fair
industrial relations.
"Labour in fact is only physical in external form.
In its origin it is mental or on strict analysis spiritual
As
land is the natural or passive factor in all production, so labour
is the human or active factor. As such, it is the initiatory factor.
All production results from the action of labour on land
"[17]
The late Pope John Paul II emphasised that in seeking to establish an
"ethically correct labour policy", it is important to be
aware of the influence of many factors beyond the direct relations
between employer and employee. He developed the concept of an "indirect
employer" that he described as including --
"
both persons and institutions of various
kinds
and the principles of conduct which are laid down by
these persons and institutions and which determine the whole
socio-economic system or are its result."[18]
In the natural state of humanity, all people have the right to freely
apply their labour to the Earth, to own the fruits of their labour and
also to enjoy the Earth for other purposes. This natural right derives
from the axiomatic right of all people, by virtue of their existence,
to life itself.
"The natural right which each man has, is not that of demanding
employment or wages from another man; but that of employing himself-
that of applying his own labour to the inexhaustible storehouse which
the Creator has in the land provided for all men."[19] The only
proper limit on the right to land is the equal rights of all other
people to the same. Violence against the freedom of labour begins with
any further restrictions on the capacity of labour to access land. To
deny people the full fruits of their labour, by whatever means
(including industrial relations laws) has the same violent effect as
directly denying their natural right of free and equal access to land.
PRIVATE PROPERTY IN LAND
There are many ways in which labour is robbed of its freedom and fair
reward apart from the marginal adjustments effected pursuant to
industrial relations legislation. The main structural causes are the
private ownership of land and the correlative unfair privileges
arising out of trade restrictions, taxation and interest rates. These
arrangements enable persons granted an unjust privilege by the State,
to acquire without labour, the property rightly belonging to persons
who have expended their labour.
The more than doubling in the price of land that has taken place in
Australia since 1996 represents a far greater theft of the rightful
wages of Australian workers and their families than will ever be
executed pursuant to the new industrial relations laws.[20] Yet there
has been very little organised protest about this. Much of this
inflation in land price is attributable to non-productive speculation,
particularly by overseas interests.[21] The recent massive inflation
in land price has made it very difficult for young Australians to buy
their first home and also for new businesses to get started.
Interestingly, land price increase is not factored into the cost of
living increases as measured by the Australian Bureau of
Statistics.[22] Since 1996, annual inflation has been measured at an
average of only 2.4 percent[23]. The Federal Government points to
figures showing that real wages have grown by 14 per cent since 1996.
However, doubt is cast over the notion that Australian workers are
prospering when one considers land price rises and the loss of many
valuable working conditions traded-off as part of enterprise
bargaining agreements. The general public, particularly home-owners
and mortgagors have possibly been hoodwinked into believing that
rising land prices are good for them personally and are necessarily a
sign that the economy is robust. The Government claim that our economy
is strong is challenged by the fact that for the decade prior to 2003-
"
the debt of the household sector
increased
at an average annual rate of 14 per cent, which is well in excess of
the growth of household income
It is clear
that housing
debt makes up the major part of household debt"[24]
Land price is a reflection of the value of the communal labour
co-operation embodied in the services accessible from any given site.
Additionally, land prices are significantly inflated due to
speculation that anticipates improvements to these services over time.
Security of tenure over land is an important pre-requisite for a
productive economy. However, the private appropriation of the value of
communal labour co-operation is contrary to the natural justice
concept that we are each entitled to own nothing more than the fruits
of our own labour.
RESTORATION OF LAND RIGHTS
The public appropriation of the value of communal labour co-operation
by way of an annual site rental charge is the natural way to fund
government expenditure. Site rental value is created not by individual
effort, but by the community as a whole. Taxation shackles and robs
labour, stifles enterprise, impedes production and restricts free
trade. The freedom of labour requires the abolition of taxation and
the government collection of full site rental values. Site rental
revenue would amply meet the requirements for the provision by
government of necessary and desirable public services.[25]
Land price is the enemy of the freedom of labour. Where land price
exists, equal access to land is blocked, demand for labour is
inhibited and wages are repressed. The collection of site rental value
as the sole source for government revenue would eliminate land price.
Land value would remain and be determined by the market forces of
labour competing for access to various sites.
"Well may the community leave to the individual producer all
that prompts him to exertion; well may it let the labourer have the
full reward of his labour, and the capitalist the full return of his
capital. For the more that labour and capital produce, the greater
grows the common wealth in which all may share. And in the value or
rent of land is this general gain expressed in a definite and concrete
form. Here is a fund which the state may take while leaving to labour
and capital their full reward. With increased activity of production
this would commensurately increase."[26]
CONCLUSION
The current regressive re-regulation of industrial relations by the
Federal Government presents an opportunity for the labour movement to
re-open the case for true justice for Australian workers. This
requires education and advocacy for a peaceful restoration of people's
natural rights at work. This is a claim for the full reward of labour
to be returned to the workers. This is a call for the freedom of
labour. This is the case for a system of natural industrial relations.
NOTES AND REFERENCES
- Henry George, The Condition of
Labour, Land and Liberty Press, Edinburgh (1891) 1934, P.82
- Henry George, Progress and
Poverty, Schalkenbach, New York, (1879) 2001, P.438
- John Young, The Natural
Economy, Shepheard-Walwyn, London, 1996, P.15
- Richard Giles, Good
Government, August 2005, No. 973, P.2
- Henry George, The Science of
Political Economy, The HGFGB, London, (1897) 1932, P.310
- The broad thrust of the new
laws are supported by the Business Council of Australia, The
Australian Chamber of Commerce and Industry, The International
Monetary Fund, The Organisation for Economic Co-operation and
Development and others.
- See for example- Australian
Government, WorkChoices A simpler, fairer national Workplace
Relations System for Australia, 2005.
- The term 'workers' is used in
this article in the broadest possible sense to include not just
employees but also self-employed contractors, small business
people, farmers, artists, innovators, entrepreneurs and indeed any
person who strives to make a living through labour.
- Henry George, Social Problems,
Schalkenbach, New York, (1883) 1981, P.245
- Ibid, 1883, P.136
- Henry George, The Condition of
Labour, Land and Liberty Press, Edinburgh (1891) 1934, P. 56
- For further history see: The
Hon. Clyde R. Cameron, How Labor Lost Its Way, Henry George
League, Melbourne, 1984.
- R.N Ebbels, The Australian
Labor Movement 1850-1907, Cheshire-Landsdowne, Melbourne, 1965,
P.99
- Democrat, 14 March 1891:
Australian Workman, 21 March 1891.
- See The Hon Clyde R. Cameron-
A revenue that is not a tax, Prosper Australia, Hardware Lane,
Melbourne, VIC.
- Henry George, The Great
Debate- The Single Tax versus Social Democracy, St. James Hall,
London, 2 July, 1889.
- Henry George, The Science of
Political Economy, The HGFGB, London, (1897) 1932 P.324
- Pope John Paul II, Laborem
excerens (on Human Work), 1981, Pp. 18-19.
- Henry George, The Condition of
Labour, 1891, Land and Liberty Press, Edinburgh, (1891) 1934, P.82
- Australian Bureau of
Statistics, Australian Capital Territory in Focus, Catalogue
Number 1307.8, Chapter 11, 15/9/05: ABS, Australian System of
National Accounts, Table 83. Value of Land, Land use by state- as
at 30 June, Catalogue Number 5204.0, 17/11/05
- According to the Annual
Reports of the Foreign Investment Review Board, approvals for
foreign investment in Australian real estate were recorded at
$11.4 billion dollars in 1996-1997. By 2003-2004, this figure had
increased to $25.7 billion dollars.
- Australian Bureau of
Statistics, Australian CPI: Concepts Sources and Methods- 2005,
Catalogue Number 6461.0
- Australian Bureau of
Statistics, Consumer Price Index- Australia, Catalogue No. 6401.0,
26/10/05
- Reserve Bank of Australia,
Household Debt: What the Data Show, RBA Bulletin, March 2003, P.1
- See Dr Terry Dwyer, The
Taxable Capacity of Australian Land and Resources, Australian Tax
Forum, Volume 18, No.1, 2003. See also Bryan Kavanagh, The Case
for a Federal Charge on Land Values, Australian Property Journal,
February 2005.
- Henry George, Progress and
Poverty, Schalkenbach, New York, (1879) 2001, P.436
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